Asked for details on the growth rate of the ISP business, its quarterly revenue, and its potential given the fragmented market.

Management stated the ISP business is growing faster than the fire product market, driven by concerns for firefighter safety. Current quarterly revenue is $4 million to $5 million globally. They aim for $50 million to $60 million critical mass with significant EBITDA margins. Organic expansion is prioritized over M&A due to high ROI. “It's running in the $4 to $5 million per quarter range right now.”

Asked about the drivers behind the year-over-year reduction in OpEx and whether OpEx would further decrease in later quarters due to trade show seasonality.

The $1.1 million year-over-year OpEx reduction was due to restructuring efforts and cost control initiatives from Q3/Q4 last year. Q1 and Q2 include trade show expenses (FDIC, Interschutz) which will decline in the second half of the year, suggesting further OpEx reduction on a run-rate basis. “the restructuring efforts and cost control that we put in beginning at the end of Q3 and Q4 last year, our goal was to drive down $1.1 million.”

Inquired how the company plans to maintain reasonable working capital and product availability while aiming for double-digit growth, especially in fire products.

The strategy involves careful management of accounts payable and receivable, and making initial investments in raw materials for fire products. They will strategically build inventory in fire materials to meet increased demand, while maintaining appropriate levels for standard products. The potential ABL structure will provide financial flexibility. “we're going to have to make an investment in the fire materials, beginning now as a matter of fact, as we see the increased demand. So we're going to have to fund that through careful management of accounts payable and management of our accounts receivable.”

LAKE

Lakeland Fire & Safety (LAKE) Q1 FY27 earnings call: guidance and Q&A

Earnings call· Apr 2026 (Q1 FY27)· Consumer Discretionary· Jun 9, 2026

Source: earnings call transcript

Executive summary

Lakeland Fire & Safety Q1 FY27 — Fire Services Growth and Margin Improvement

Lakeland Fire & Safety delivered a transitional Q1 FY27, marked by strong 11% growth in Fire Services and significant improvement in net income and adjusted EBITDA, despite a year-over-year decline in gross margin due to strategic inventory build and certification costs. The company is focused on converting robust demand in Fire Services and key industrial channels into improved profitability and cash generation through operational execution and margin expansion initiatives in the latter half of the fiscal year. Strategic investments in the ISP platform and a simplified product portfolio are expected to drive long-term value.

Highlights

Net sales increased by $0.7 million or 1.4% to $47.4 million, driven by 11% growth in Fire Services.
Net income improved significantly to $0.4 million ($0.04 EPS) from a $3.9 million net loss in Q1 FY26.
Adjusted EBITDA excluding FX improved 79.6% to $1.1 million, with margin expanding to 2.3% from 1.3%.
Cash and cash equivalents increased to $17.4 million from $12.5 million, with $5.8 million net cash from operations.
Divestiture of HPFR and HiViz product lines for $14 million simplified the business and strengthened the balance sheet.

Concerns

Adjusted gross margin declined to 33.6% from 35.2% in the prior year, impacted by product mix (150 bps), NFPA certification costs (80 bps), and capitalized freight release (70 bps).
U.S. industrial business has not seen meaningful recovery, and oil and gas turnaround activity remains slow.
Middle East uncertainty temporarily slowed project timing and froze certain regional budgets for LHD Germany.

Guidance & targets

Category	Target	Timeline	Confidence
Full-year 2027 revenue growth	high single-digit growth high materiality	FY27 · 2027	High
Full-year 2027 cash flow from operations	positive high materiality	FY27 · 2027	High
Adjusted gross margin	continue to expand high materiality	through the rest of the fiscal year · 2027	Medium
Revenue growth, margin improvement, and EBITDA expansion	become more visible high materiality	back half of fiscal year '27 · 2027	Medium

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Fire Services Increased by $2.4 million compared to $21 million in the prior year period. Driven by Latin America, Mexico, and Viridian. Achieved NFPA 1970 certifications for a full head-to-toe product portfolio. Revenue contribution to total: 49%	$23.4 million	11%	—	—
Industrial (Latin America) Delivered the strongest regional performance in Q1, attributable to disciplined commercial execution. Lead times extended due to Middle East conflict. Performance to plan: 119%	—	—	—	—
Industrial (Asia) Delivered the strongest regional performance in Q1, attributable to disciplined commercial execution. Performance to plan: 132%	—	—	—	—
Eagle (EMEA) Delivered double-digit growth in Q1. Expects opportunities to expand in H2 FY27 following an intended award under the National Fire Chiefs Council National Firefighter PPE framework in the U.K.	—	double digit growth	—	—

Product announcements

Product	Type	Timeline
New Pacific Structural Firefighting Helmets	launch	Q1 FY27
New Jolly Structural Boots	launch	Q1 FY27
New Lakeland Extraction Gloves	launch	Q1 FY27
New range of Lakeland and Viridian Structural and Wildland Gear material and reflective trim options	launch	Q1 FY27

Deals & partnerships

Deckers Logistics Logistics partnership

Completed the transition of LHD Germany's operations from Wesseling to a third-party logistics model.

National Fire Chiefs Council PPE framework award GBP 220 million seven-year term

Eagle received notification of an intended award under the National Fire Chiefs Council National Firefighter PPE framework in the U.K. This framework has a total potential value of GBP 220 million over a seven-year term across all awarded suppliers. Lakeland is one of about 4 suppliers in most categories (hoods, gloves, boots, structural fire kit).

Risks & headwinds

Middle East uncertainty Q1 and Q2 FY27

temporarily slowed project timing and frozen certain regional budgets

Mitigation:Focused on converting identified opportunities, improving margins, and positioning LHD for stronger performance in the back half of fiscal 2027.

U.S. industrial business and oil & gas market weakness Q1 FY27, expected to gain traction in H2 FY27

not yet seen a meaningful recovery in the United States, nor have we seen any meaningful uptick in oil and gas turnaround activity

Mitigation:Focused on channel execution, pricing discipline, inventory alignment, and positioning the U.S. disposal business to benefit when end market demand strengthens.

Extended lead times into Latin America due to Middle East conflict Q1 FY27

extended our lead times into Latin America

Mitigation:Focusing considerable efforts on mitigating any risk to performance through tight alignment between commercial and operations teams.

Manufacturing and stock capacity constraints Q1 FY27, ongoing

new product demand growth that has outpaced our prior manufacturing and stock capacity

Mitigation:Manufacturing ramp-up activities are underway at Lakeland, Viridian, Pacific, and Jolly. Strategically increased inventory in key fire categories and expedited freight to support customer demand and market launches.

Q&A highlights

Inquired about the current backlog size compared to six months ago, its conversion to revenue, and the long-term growth potential given NFPA standards.

Management confirmed the backlog is primarily in turnout gear with 8-12 week lead times, currently extended due to high demand. Manufacturing is ramping up in Mexico and the U.S. The NFPA standards have created an extended opportunity, exemplified by a 7-year, GBP 220 million UK tender framework.

“The backlog is tied primarily to turnout gear. Typically in the 8- to 12-week lead time, manufacturing lead time frame, which we're pushing out a little bit on that because of capacity.”

asked by Gerard Sweeney · answered by Barry Phillips

2 min read 6 chapters

Detailed narrative

NFPA 1970:2025 Certification & Fire Portfolio

Lakeland achieved NFPA 1970 certifications for its head-to-toe fire portfolio, including Pacific Helmets, Jolly boots, Veridian turnout gear, and Lakeland turnout gear and gloves. This comprehensive certification was showcased at FDIC 2026 and Interschutz, generating strong customer engagement and tender activity, which is expected to drive future growth.

The breadth of the certified portfolio is seen as a significant competitive advantage, as fire departments increasingly seek complete solutions from global providers.

Service Platform Expansion

The ISP platform continues to build momentum as a recurring revenue and customer retention opportunity. Lakeland is expanding its service footprint by opening a new ISP location in Denver, Colorado, and expanding its Arizona PPE facility in Phoenix to support continued growth.

The company also added CO2 decontamination capabilities in Fresno, California, differentiating its service offerings and strengthening its position as a full-service fire safety partner, providing advanced decontamination solutions.

Strategic Divestiture and Focus

Lakeland completed the divestiture of its high-performance FR and HiViz product lines for approximately $14 million in cash proceeds. This strategic move simplified the business, strengthened the balance sheet, and improved liquidity. It allows for a more focused allocation of resources towards core Fire Services and industrial protective products, areas identified for stronger long-term growth and margin opportunities, aligning with broader efforts to reduce complexity and improve focus.

Industrial Business Outlook

While the U.S. industrial business has not yet seen a meaningful recovery, and oil and gas turnaround activity remains slow, other regions like Latin America and Asia delivered strong Q1 performances, exceeding plan by 119% and 132% respectively. The company is cautiously optimistic for the latter half of FY27, focusing on channel execution, pricing discipline, and inventory alignment to benefit when end market demand strengthens.

Facilities in Vietnam and China remain at capacity due to improving demand.

LHD Repositioning and EMEA Performance

In Europe, Lakeland is actively repositioning LHD, including a brand relaunch at Interschutz and the appointment of new sales leadership. Q1 and Q2 are viewed as transitional periods for LHD Germany, with operational improvements underway, including a shift to a third-party logistics model with Deckers Logistics.

Eagle, a UK brand, expects expanded opportunities in H2 FY27 following an intended award under the National Fire Chiefs Council National Firefighter PPE framework, a seven-year program with a potential value of GBP 220 million.

Backlog and Production Ramp-up

The U.S. fire business backlog, encompassing both Viridian and Legacy Lakeland products, continues to grow to historic levels. This is attributed to new product demand outpacing manufacturing and stock capacity, particularly for turnout gear. Manufacturing ramp-up activities are underway at Lakeland, Viridian, Pacific, and Jolly facilities to meet this demand, with the goal of converting the open order backlog into revenue and supporting market launches.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.